DAX, CAC and MIB Forecasts – Europe Still Looks Supported Despite Wobble on Tuesday

DAX 40 Technical Analysis

The DAX in Germany fell a bit during the early part of the trading session as interest rates around the world have shown themselves to be dropping. And I think the way we have fallen; it looks to me like maybe we’re just a little overextended. I think the 25,000-euro level continues to be very important.

I also recognize that as long as interest rates start to cool off, and Germany, the 10-year yield is below the 3% level, so that’s a good sign, that does help, and we could see a little bit more of a jump into this index. Keep in mind that if we get good news out of the Middle East, that helps very much the idea of going in and finding stocks attractive.

CAC 40 Technical Analysis

In France, we’ve seen a little bit of a pullback as well. It looks like we are hanging around the 8,200-euro level. The area of course is a large round psychologically significant figure, but we also have the 50-day EMA and the 200-day EMA underneath.

French rates have dropped over the last couple of days. They did rise a little bit during the Tuesday session, just like they did in Germany, so it does put a little pressure on equities. But again, I think France is something you want to buy. You just have to recognize that perhaps it’s being held hostage by the idea of energy shortages possibly coming from the Middle Eastern situation.

MIB 40 Technical Analysis

The MIB in Italy continues to look very bullish. We’re basically at all-time highs. I think we will probably continue to grind to the upside. I like the idea of buying dips. I like the idea of trying to get to the 51,000 level, and I do think we will get there given enough time.

Anytime we pull back, the 49,000 level I think would be an area where a lot of people might be interested in buying as well.

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